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CARES Act provides needed relief to legal profession

April 6, 2020

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The $2.2 trillion coronavirus stimulus package known as the CARES Act passed by Congress and signed into law March 27 provides for economic relief for most American people and businesses. Lawyers and the legal profession also will benefit.

Lawyers and the legal profession will benefit from much-needed financial relief prescribed in the CARES Act legislation.

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The CARES Act includes immediate tax rebates of $1,200 for each adult and $500 for each child under 17, beginning to phase out at an annual income of $75,000 for an individual and $150,000 for a household, with a complete phase out for individuals earning $99,000 or more and households earning $198,000 or more. It also provides extensive monetary relief to support small business operations, including eligible small and solo law firms.

Other provisions in the law that will affect the legal industry and American Bar Association advocacy issues include:

Emergency funding of $50 million for the Legal Services Corporation to help address the increasing legal needs of low-income Americans caused or made worse by the coronavirus.

Suspension of federal student loan repayment obligations for borrowers until September 30. During this time interest does not accrue, and borrowers get credit as if they had made the payments — including for the purposes of the Public Service Loan Forgiveness program.

More than $7.5 million to support mission critical activities of the federal courts and their staffs. The money includes $500,000 for the U.S. Supreme Court to enhance telework capabilities, $6 million for federal courts to increase telework capabilities and cover higher costs of pretrial and probation services, and $1 million for U.S. Defender Services to expand remote work capacity.

Election assistance funding of $400 million to help states to prepare for and respond to coronavirus for the 2020 federal election cycle.

$100 million for grants to increase broadband access in rural communities where at least 90% of households do not have adequate broadband, plus $25 million to expand broadband for distance learning and telemedicine to increase access to telecommunications for households in rural communities and for professionals providing services to these communities.

More than $7 billion for affordable housing and homelessness assistance programs to help low-income and working Americans avoid evictions and foreclosures.

$260 billion in dramatically expanded unemployment benefits.

The law also gives $100 million in funding to the Federal Bureau of Prisons for urgent needs like access to personal protective equipment, testing materials, home detention, electronic monitoring, and other alternatives to incarceration to improve prison conditions.

The CARES Act provides $850 million in expedited grant funding to state and local police departments and jails for local health protection needs. It will allow for the creation of temporary rules to institute video and audio conferences for some procedures such as detention hearings, arraignments, and misdemeanor pleas and sentencings. The law also allows rules to provide free telephone and video visitations with inmates and relaxed rules on early release and home confinement.

“Prisons and jails are some of the highest-risk environments for the spread of COVID-19,” ABA President Judy Perry Martinez said. “The ABA is encouraged that the COVID-19 economic stimulus includes provisions to allow prisons greater access to personal protective equipment and COVID-19 testing materials. The ABA is further encouraged by the bill’s provisions that expand use of home detention and electronic monitoring.”